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Tata Sons to sell 1.48% stake in TCS, raise Rs8,500 cr

Tata Sons to sell 1.48% stake in TCS, raise Rs8,500 cr

Tata Sons today sold shares valued at almost Rs 9,000 crore in Tata Consultancy Services (TCS) through open market transactions.

Tata Sons will sell 28.27 million shares of Asia's largest software developer, or about 1.48% stake, according to the terms.

The offering for the Tata Consultancy stocks are to be arranged by Citigroup Inc. and Morgan Stanley with a price range representing a 4.2 percent to 5.9 percent discount to its last closing. The orders in a block deal are not shown to people who trade from normal trade window.

Experts are of the view that the proceeds can be used to deleverage the balance sheet of Tata Sons, which paid $1.27 billion to Docomo to settle a dispute with the Japanese telecom giant after it exited their joint venture in 2013.

The holding company is also seeking an offshore syndicated loan, as it seeks to pay down expensive debt at telecommunications unit, people familiar with the matter said last week. Tata sold Tata Teleservices' mobile-phone operations to Bharti Airtel past year and pledged to pay the unit's obligations.




Other industry experts point out that Tata Sons may choose to use the TCS stake sale proceeds to fund Tata Steel, which is hoping to snap up Bhushan Steel and Bhushan Steel and Power.

Tata Teleservices earlier had a debt of around Rs 30,000 crore of which it has repaid Rs 17,000 crore.

After the proposed share sale, Tata Sons' holding in Tata Consultancy Services (TCS) will come down to around 72 per cent from 73.52 per cent as on December, 2017.

TCS, the top Indian software services exporter, is the second-most valuable company in the country with a market capitalisation of close to $90 billion.


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